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MGTA01H3 (583)
Chapter 8&9

MGTA03 Chapter 8&9.doc

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University of Toronto Scarborough
Management (MGT)
Bill Mc Conkey

Chapter 8 Organizing the Business EnterpriseWhat is Organizational StructureTerms organizational structure the specification of the jobs to be done within a business and within a business and how these jobs relate to one anotherThe Chain of CommandTerms organization chart a physical depiction of the companys structure showing employee titles and their relationship to one another chain of command reporting relationships within a business the flow of decision making power in a firmSpecializationdetermining who will do what job specialization the process of identifying the specific jobs that need to be done and designating the people who will perform them a large task such as manufacturing and selling cars is split into small tasks developing the car frame creating tires building engines advertising the product etc with each task assigned to a different individual has certain advantages such as high efficiency in job performance easy to replace anyone who leaves the organization and easier to learn the task however if job specialization is carried too far and jobs become too narrowly defined people get bored and derive less satisfaction from their jobs as well as losing sight of how their contributions contribute into the overall organizationDepartmentalization departmentalization the process of grouping jobs into logical units profit centre a separate company unit responsible for its own costs and profits departmentalized companies benefit from the division of activities control and coordination are narrowed and made easier and top managers can see more easily how various units are performing it also allows the firm to treat a department as a profit centre by assessing profits from sales in a particular area Sears can decided whether to expand or curtail promotions in that area managers do not group jobs randomly but logically via some common thread or purpose consumer functional geographic andor processEstablishing the DecisionMaking HierarchyAssigning Tasks assigning tasks determining who can make decisions and specifying how they should be made
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